Greece “bankrupt” says Sweden’s Reinfeldt

By: Jonathan Boyd | 30 Jan 2012

Swedish prime minister Fredrik Reinfeldt today called Greece “bankrupt” and said he supported Germany’s position on future oversight of the Greek national budget.

Speaking ahead of the start of today’s negotiations in Brussels, Reinfeldt said that Greece had only delivered €1bn of the €50bn of promised privatisations, as well as failing to deliver on other promises made to creditors.

“In reality, Greece is bankrupt and has not done what it promised. At the end of the day creditors will tire and will move for more control,” Reinfeldt said.

He expressed support for the German view that some form of control be excercised by the European Commission for oversight of the Greek budget to ensure that promises made are delivered.

However, that option has been rejected by Jean-Claude Junker, the Luxembourg prime minister who chairs the eurogroup. Today he said the idea of a special commissioner to oversee Greece was “unacceptable”.

Italy better

Meanwhile, the market signalled its acceptance of changes to Italy’s fiscal policies being pursued by technocrat prime minister Mario Monti. Yields on 10-year bonds fell by almost 100 basis points at an auction for €7.5bn in government debt.

The yield of just above 6% is the lowest since October 2011. The country has an estimated €90bn in government bonds maturing between February through April 2012, according to Bloomberg figures.

Merkel’s view

German chancellor Angela Merkel outlined her views on arrival at today’s meeting in Brussels